Mark L. Hopkins: Puzzle me this

Monday

Nov 27, 2017 at 8:59 AMNov 27, 2017 at 8:59 AM

Yes, I know I stole a key line from the Broadway Musical, “The Pirates of Penzance,” for this title but it just seemed so appropriate.

Over and over I have heard our president and other leaders of our country talk about the need to get our economy going again. It is as if we are still in the throes of the depression of eight years ago. Let’s evaluate where we are.

Our GNP is projected at 2.2 percent. In unusually strong years it is over 3 percent and during recessions it is generally in minus numbers. Our current projection is not “hot” but it is healthy. Unemployment is registering at less than 4.4 percent, a very low number for us. Economists tell us that 5 percent unemployment is full employment, with the 5 percent allowing for technological changes in the workplace.

We are energy independent due to the development of shale oil technology and are currently exporting 439,000 barrels of oil a day we don’t need. Manufacturing set a new record last year. True, we are manufacturing different things than the heavy metal and textile industries used to manufacture. Still, manufacturing is a healthy branch of our economy. The stock market is at a record high and the automobile industry is setting record sales each month. Banks, in trouble eight years ago, reported their best year since the recession of 2008.

The question, “Puzzle me this,” relates to the confusion of the national rhetoric versus the reality of the economic statistics. In short, what numbers are our leaders looking at that are shaping their concerns? If the numbers are correct, our economy is thriving. If that is true, are the pundits at the national level “crying wolf” or do they have some “alternate facts,” of which the public isn’t aware?

Two things continue to concern me and appear to be in conflict with reality. First, the Washington rhetoric says we need to spur the economy with a tax cut. Second we need to limit the number allowed to immigrate to the U.S.

Dealing with the immigration issue first, we need to face the reality of a declining birth rate. The economy is dependent on two things for its health, continuing technological advances and a growing workforce.

For generations our scientist and engineers have been more than equal to the necessity to create technological advances. With more than 3,000 colleges/universities in the United States we can expect research and development of our economy to continue. However, our country, like most in Europe, has experienced a birth deficit. Our population is not producing as many children as we have deaths each year. Unlike Europe, we have shown modest gains in population which we can credit to immigration. Without immigration, 1 million or more a year, we can expect our population to decline. Eventually, that will lead to fewer workers and declining economic productivity. Considering that our social security and other aid for the aging are built on workers in the marketplace, that is a serious consideration when we talk about immigration.

Tax cuts sound good to us but lead to recession and growing national debt. The best indicator of the results of tax cuts is history. The Ronald Reagan tax cuts of 1981 and 1983 had us in recession by 1991. The George W. Bush tax cuts of 2001 and 2002 led to recession in 2008, the greatest recession we have had since the Great Depression.

The election of 2016 gave us four major campaign promises. These related to 1) repealing Obamacare, 2) building a southern wall, 3) increasing the number of jobs available, and 4) cutting taxes. In reverse order, we shouldn’t cut taxes, the job market is very healthy, the southern wall is a boondoggle, and Obamacare needs remediation but the remedy is, obviously, not total repeal. At least, that is what the majority of our people say.

— Dr. Mark L. Hopkins writes for More Content Now and the Anderson Independent-Mail in South Carolina. He is past president of colleges and universities in four states. Books by Hopkins currently available on Amazon.com and Barnes & Noble include “Journey to Gettysburg” and “The Wounds of War,” both Civil War-era novels, and “The World As It Was When Jesus Came.” Contact him at presnet@presnet.net.

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